Andrew Lacey, Managing Principal, with contributions from Luke Dominish, Associate and Liliana Freeman, Law Graduate at McCabe Curwood, examines testamentary capacity following Drivas v Jakopovic  NSWCA 218.
How do you determine whether a person had testamentary capacity at the moment they prepared their will? In Drivas v Jakopovic  NSWCA 218, such a dispute made its way to the NSW Court of Appeal. The Court had to balance the evidence of the solicitor who drafted the will against medical tests and expert medical opinions. In doing so, the Court has reaffirmed the significant weight that is to be placed on lay evidence in determining the question of testamentary capacity.
The death of a loved one is difficult, and disputes about that loved one’s estate can make this all the more so. Disputes concerning testamentary capacity can be emotionally charged, drawn-out, and factually complex. In recent years, the prevalence of estate disputes has increased for many reasons, including the ageing population, the increase in life-expectancy leading testators to live longer than their mental faculties, and the increase in the average size of estates (driven by the increasing value of real estate).
In Drivas v Jakopovic, the appellant disputed the will of her grandmother, and the NSW Court of Appeal upheld the decision of the primary judge who gave significant weight to lay evidence over medical evidence in determining whether the deceased had testamentary capacity at the time she made her will.
What is testamentary capacity?
In order to create a valid will, a testator must have capacity at the time they executed it. The law on this point is well established, dating back to the decision of Cockburn CJ in Banks v Goodfellow (1870) 5 LR QB 549.
Essentially, the law requires that the testator:
- must have understood the nature and significance of the act of making a will (i.e., what does it mean to make a will?);
- must have understood the nature, extent, and value of their estate (i.e., what does their estate comprise of?);
- needs to be capable of comprehending and appreciating any claims on their estate (i.e., who may have a claim on their estate?); and
- must not have suffered from a delusion that influenced the terms of the will at the time it was made (i.e., was the will ‘tainted’ by delusions the deceased was suffering at the time?).
If all of these elements are present, then the testator will be found to have capacity and the Court will uphold the will. Of course, this leads to an evidentiary question – how does one prove that the deceased had capacity?
The estate of Jakopovic
This was the issue that the NSW Court of Appeal had to consider in Drivas. The case concerned the deceased, Ms Marija Jakopovic, who in May 2007 executed a will leaving her estate equally to her two children, Boris and Branka. The May 2007 Will provided that in the event either Boris or Branka predeceased their mother leaving children, then those children would take their parent’s share of the estate.
A short time later, in September 2007, Ms Jakopovic executed another will, which was substantially identical save that it removed the provision allowing Branka’s children to inherit in the event that she predeceased her mother. The provision for Boris’ children remained. As it happened, Branka predeceased Ms Jakopovic, leaving a daughter, Anita, surviving her.
Following Ms Jakopovic’s death in September 2015, the September 2007 Will was admitted to probate in common form. Anita subsequently sought probate of the May 2007 Will on the basis that, as she was suffering dementia, her grandmother lacked testamentary capacity at the relevant time.
The role of lay evidence
In determining whether Ms Jakopovic had testamentary capacity at the time she executed the September 2007 Will, the Court considered evidence provided by Mr Taylor, the solicitor who drafted the will, as well as additional medical evidence.
Although Mr Taylor had no independent recollection of acting for Ms Jakopovic, he gave evidence that he had experience in drafting wills, powers of attorney and appointments of enduring guardians for elderly clients. He was aware of the Banks v Goodfellow test and stated that it was his normal practice to make detailed notes of his discussions with a client and keep those notes in the firm’s safe custody if he had reservations about whether that client satisfied the test. No such notes were included in the firm’s safe custody. He also said that the inclusion of the provision that only Boris’ share of the estate, and not Branka’s, would go to his children if he were to predecease them was not in accordance with his usual practice. He stated that he would have only included this provision if specifically instructed by the client to that effect.
With respect to the medical evidence, the Court considered a CT scan of Ms Jakopovic undertaken in October 2006 which showed she had significant vascular disease in the brain, consistent with dementia. It also considered the MMSE three tests, which are used to screen for dementia, administered to Ms Jakopovic in April and June 2007. However, the Court held that these two tests did not constitute significant evidence of testamentary incapacity given that they did not provide reliable information as to the degree or nature of the impairment. Further conclusory expert medical opinion was also provided by two doctors. However, the Court again did not give it any significant weight as it was apparent the doctors were not aware of the full facts surrounding Ms Jakopovic’s relationship with her family.
Conversely, the Court placed significant weight on the evidence of Mr Taylor for reasons including the following:
- he was a solicitor of considerable experience, including in dealing with elderly clients and their testamentary wishes, so was accustomed to detecting issues with capacity;
- given the considerable time he spent alone with Ms Jakopovic, he was able to form a view about her testamentary capacity and instructions to him; and
- it was his practice to satisfy himself of his client’s instructions when preparing the will to give effect to their intentions.
Given the evidence of Mr Taylor, the Court ultimately upheld the decision of the primary judge and determined that Ms Jakopovic did have testamentary capacity when she made the September 2007 Will.
What does this all mean?
The decision of Drivas v Jakopovic highlights the importance of lay evidence over medical evidence in determining whether a testator had testamentary capacity at the time they executed their will. Although medical evidence can indicate deterioration of brain function and mental state, there are issues when inferences are made without any consideration of the testator’s personal circumstances.
The Courts have consistently placed great emphasis on lay evidence of observations of the deceased at the time they prepared the will in question. However, what makes this case all the more unique is that it was the absence of evidence to the contrary that was persuasive. That is, the court was able to draw an inference sufficient enough to satisfy itself on the question of capacity from what the solicitor did not do, rather than what he did. That is, the failure of the solicitor to keep his notes indicated that he formed the view at the time the deceased had capacity.
Cases like this always serve as an important reminder to keep your will updated to reflect current intentions. It is also a reminder for solicitors to be diligent in satisfying themselves of the elements of Banks v Goodfellow when preparing a will for a client to ensure that the client has testamentary capacity at the time they execute their will.
If you would like to hear more insights on court-authorised will applications for persons lacking testamentary capacity, you may be interested in attending Complex Estate Planning and Litigation where the presentation will focus on practical tips, relevant legislation and recent case studies.
Andrew Lacey is recognised as a leading Australian commercial litigator. He is the Managing Principal at McCabe Curwood and heads the litigation and dispute resolution group. His experience in commercial, general litigation and dispute resolution spans a broad range of jurisdictions and industries. Andrew acts for both public and private clients including medium to large Australian and international businesses, major manufacturers, property developers, insurance and finance brokers and financial institutions. Andrew has particular expertise in corporations and competition law disputes, regularly advising on directors’ duties. Acting for a number of insolvency practitioners, he provides advice to directors and shareholders on all aspects of insolvency, with a focus on practical and cost-effective solutions for clients. You may connect with Andrew via email: [email protected]